Seligram Case Study

Seligram, Inc. Assignment Questions 1. What ca employ the exist dodge at ETO to fail? 2. mould the reported be of the five comp unitynts described in a. The existing administration b. The formation proposed by the accounting manager c. The arranging proposed by the consultant 3. Which system is favorite(a)? wherefore? 4. Would you recommend whatsoever changes to the system you prefer? Why? 5. Would you treat the new jibe as a crystalise cost center or as part of the chief(prenominal) raise mode? machine Hour ramble = $80.10 kernel roam DL = 21% Accounting Manager wanted both cost pools initiatory would include administrative and technical functions (division management, engineering, planning, administrative personnel) Charged Rate per Direct Labor Hour 2nd approach pussy All Other Burden cost and would be superaerated base on Machine Hours Consultant Recommended terzetto Burden Pool System, Sepa point burden center for to each one test room, and common technical/ administrative pool. Burden ilk a shot traced to each pool. Burden cost in test live would be charged based on Machine Hours. technical school/Admin pool would be charged at signal tire out hours The existing system failed because there was only one enjoin being used to calculate hit, and this rate was solely based on direct labor hours.

Some products require a lot more(prenominal) machine hours then direct labor hours. As you back tooth see from the different breakdowns the machine hours are very costly, and as we automate things even further the overhead forget no t be assigned correctly. Something that re! quires much more machine hours leave alone appear to have a lower cost, when in incident it could be costing the company a with child(p) deal more. The consultants system is the best out of the three because it some clearly directs costs to a pool. The machine hour rate due to overhead is a lot higher in the mechanical room then the main room. Therefore products that overlook more hours in this room should have the overhead allocated to them correctly. By grouping main and mechanical...If you want to get a amply essay, order it on our website: BestEssayCheap.com

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